OT: NFL or Return with Insurance: What would YOU do?

Submitted by shawnducati on January 4th, 2017 at 6:20 PM

2 Questions:

1. I think there is a tiered insurance policy program for potential early NFL entries based on projection, but can anyone clarify the amount of insurance that someone like Jake Butt would have gotten OR the amount that Jabril might get if he comes back next year?


2. What would you do? I know when I was in undergrad at UM studying Mechanical Engineering, I had a job at Chrysler waiting for me, so I really wanted to stay for a 5th year instead of coming out in 4. I REALLY LOVED my UM/AA experience and wanted to enjoy it as much as possible. I saw a lot of my friends graduate in 4 and I felt it was too soon! I really do think that many times, when student athletes are faced with this decision, we underestimate how young they are and how much they really enjoy college...so I am sure this is a geniune decision for Jabril (who is my fraternity brother and he really loves our frat and loves college life!).

So, again, what would you personally do if YOU were in this situation with a potential early NFL career waiting...but also knowing how much you loved UM/college?





January 4th, 2017 at 6:27 PM ^

would have been very easy for him to declare if he was that convinced. It wouldn't have been a shock to anybody. He is clearly weighing this more than most expected he would. If I had to guess based on the nothing I know, he wants an expanded role on offense if he returns and is inquiring as to whether that is going to be a thing or not.


January 4th, 2017 at 6:55 PM ^

the decision is clear as crystal: Go. No doubt about it.

If you are about LIVING, about finishing things started, about taking risks, about acheiving glory: Stay. The only caveat being if you are afraid of injury perhaps you should go because if that worries you because you probably won't do your best if you stay. The guy who goes straight into the NFL is about football and financial gain; the guy who tarried in College for one more year is about a fuller life. Either way, even if injured and collecting insurance, he will make more money than 90% of us ever will.

Stay. Achieve. Be glorified forever as a Wolverine.

Go Blue.

Mr Miggle

January 4th, 2017 at 7:01 PM ^

sufficient insurance? He's not less likely to get injured in the NFL next year. Fournette had two $10 million policies. One was just for dropping out of the high first round.

Butt has two similar, but smaller policies. He'll collect on one if he drops past the 2nd round, both if he can't play.


January 4th, 2017 at 7:27 PM ^

The report I saw was $4 million if Butt's disabled and can't play in the NFL, $2 million if he drops past the second round due to injury.

1. Those numbers are a lot less than a full contract would play but it's enougfh for a comfortable life even without doing something else as a career.

2. An insurance policy protects you in the future but doesn't put money in your pocket today. Apparently Peppers grew up in real poverty. He has an incentive to get the money today to take care of Momma. On the other hand, he has to consider lost opportunities if he leaves for the NFL: no Heisman, no crushing defeat of OSU, no NC. Like most things in life it's a question of balancing competing factors.


January 4th, 2017 at 9:52 PM ^

I certainly don't follow this closely, and my info may not be current so take it with a grain of salt. But in general:


1)They get two forms of insurance- a disability policy which covers the injury more directly and then a loss of value insurance which is basically just draft value loss. The disability policy is probably not going to payout unless you more or less never play again. The policies more or less all flow through Lloyd's of London and affiliated underwriters. Or at least used to. It's a relatively new product at least for college football players. General rule of thumb on the loss of value policies is 1% of the payout is paid as an annual premium. So if Butt had $4 million in loss of value (hypothetically, I don't know what he had) then a $40,000 premium which is more than a family can usually pay. 

2)Not many people have actually collected on a policy. I think 2 NCAA football players ever...last I heard. Marquise Lee from USC also had a lawsuit at one point. 

3)Tax free if the player pays for it. It's not clear if the school pays for it. I don't know that the IRS has ruled on this, but probably not given the scarcity of claims. I don't know anything about if there are NCAA rules, but since insurance is optional and relatively rare, it could actually be a potential recruiting advantage for schools? Maybe. I mean, as far as I know, you could offer to buy insurance for any all-conference players on your team, thus getting kids to stay another year. And could you even include this in your pitch to HS kids? Dunno, maybe. 

4)To my knowledge, they are all lump sum payouts rather than annuities or other structures which doesn't necessarily make sense for tax purposes if it is taxable because teh school bought it. But again, only a few have ever paid out and I don't know if anyone has actually paid taxes on these.


January 4th, 2017 at 10:22 PM ^

Disability insurance is not taxable if the employee pays for it. Of course the employer can give "extra pay" to cover the premiums but it's still up to the employee to actually pay for premiums. The disability policies that I'm familiar with usually pay out in monthly installments, not a lump sum.

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January 5th, 2017 at 10:06 AM ^

In today's game and today's market, if you earn a $15 million payday, yoiu take it: now and with no regrets.  

As for insurance: puh-leeze.  Insurance companies are great utntil it's actually time for them to pay off.  Even if they would write a policy for $15 million, if he was injured they would force him to "settle" for far less.  I am guessing the most he could ever extract out of an insurance company for losing his position in the draft or hot being able to play anymore is $5 million. 

That is still a loss of $10 million.  I love Michigan football, but I want to see this young man set himself up for life while he has the opportunity.


January 4th, 2017 at 7:13 PM ^

Agree. A year in college instead of a year in the NFL could be, say, $1.5M lost in career earnings. If someone told me I had to effectively pay someone $125,000 for every game I play in college - in addition to going to class and making sure grades are up - I'd tell them they're insane.

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January 4th, 2017 at 7:43 PM ^

Well if you're top-10, you're more at the mercy of team needs in the top and can shuffle around. If anything, you'd be more likely to drop than move up a few spots unless you were lucky and someone needed a safety (and wanted to take one top-5, which is another debate in and of itself).

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January 4th, 2017 at 7:39 PM ^

I 100% agree.

However, do you think Charles Woodson values his heisman and legacy at UM more than 1.5 Million in lost earnings in retrospect? Granted, 1.5M in extra earnings is a lot to forego, however, if one is likely to earn millions during their career anyways, it is truly hard to put a dollar value on leaving a potentially lasting legacy.

As the OP asked, most of us here would take the money for the reasons you mentioned. However, being a Michigan legend forever is incredibly difficult to monetize.


January 4th, 2017 at 7:15 PM ^

I'd be thinking of how my grandkids that are sitting bedside could've had their college paid for if I left early instead of tearing my ACL in game 3, not getting to play against OSU, losing that game nonetheless, and never healing properly enough to pass team physicals and becoming an afterthought.

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January 4th, 2017 at 6:24 PM ^

Even with insurance it is too hard to project the potential loss in career earnings due to a bad injury. Pair that with how short the average NFL career is, and I would do my best to get my degree in 3 and move on.


January 4th, 2017 at 6:27 PM ^

every player should strive to enroll as early as possible and get their degree in 3 years

if NFL draft worthy, leave after 3 with a degree

if not, stay 4-5 and also get your masters paid for

if things aren't working out at the school you are at, grad transfer with 2 years left, not one


this should be everyone's plan - no downside tbh


January 4th, 2017 at 6:25 PM ^

the NFL has a shelf life


each extra year in school is one less year of high earnings


even the min salary is $400K


only stay if there is a reasonable chance to move up your draft slot


January 4th, 2017 at 8:15 PM ^

Kobe was a High school to NBA case. It was theorized he would have a longer NBA career due to no NCAA wear and tear. turned out it wasn't the case and NBA shelf life is shelf life. The grind of practice and games and travel are the same, regardless of college or high school play.
Granted some athletes are just freaks, but Peppers needs to do whats best for him. I would say it's go to the NFL. without doubt it has been a childhood dream. No chance next season at Michigan makes it any better for him. Sad to say, he represents us as well as anyone, and will be a generational player...but he gave us everything he needed to.


January 4th, 2017 at 6:25 PM ^

1. There are different policies that have different payouts.

2. I like where your head is, but this might not be the best place to collect data on this topic. I'm guessing the majority of people in here are "working stiffs" and know the value of a hard-earned buck. That said, my prediction is most would leave and take the money. I would.

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Mr Miggle

January 4th, 2017 at 7:21 PM ^

So they are the only ones who could solve that problem and they don't care. CFB and their players have no say in when they're allowed to join the league. 

Sitting out college isn't a great idea for helping your NFL prospects. Clarett and Mike Williams tried it for a year. It didn't do them a lot of good. Williams was lucky Detroit had an incompetent GM. Expect other GMs to learn from that.



January 4th, 2017 at 6:32 PM ^

...but I'd return. You only have one opportunity to enjoy the college environment. Personally, I don't like the idea of exiting early. It feels like the university for which you're playing extends its legacy, tradition and educational opportunity to you in exchange for your playing commitment and to leave early belittles what I consider to be a nice offer of a gratis degree (unless, of course, you're enrolled at a lackluster school such as OSU).  



January 4th, 2017 at 8:48 PM ^

Except you don't really have one opportunity to enjoy the college environment.  Most NFL players aren't in the league as long as Woodson - most are done long before they even turn 30.  You could go do an MBA if you wanted, still be a similar age as your classmates, and while it's not the exact same as undergrad, it can be just as fantastic an experience.  Most top MBA schools typically have a handful of former pro athletes in their classes.



January 4th, 2017 at 6:34 PM ^

A professional athlete can probably approximate the college life reasonably well. If your primary objective is to have fun and enjoy life, you'll probably enjoy life more once you start cashing paychecks for playing the game you love. There's still plenty of time to hang out with your friends.

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January 4th, 2017 at 6:37 PM ^

Several thoughts:

- his current injury might affect the insurance payout he could receive.

- he's clearly conflicted. I doubt he wants to leave any goal unaccomplished. But remember, one of his stated goals is also to have the means to put his family in better surroundings.

- your body only has so much football in it. Do you want to charge against that account in college or in the pros? I think it's a no brainer to go pro myself, but if he gets enough extra utility from being in college, that could balance the equation...

- the girl sitting next to me on the bus home from work is gorgeous. This doesn't have anything to do with anything, but I thought I'd chronicle this thought anyway